Trump's Truth Social loses $4 billion in value in one week

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What to cognize astir Trump Media's Nasdaq debut

What to cognize astir Trump Media's banal marketplace debut 04:03

Former President Donald Trump's media institution appears to beryllium losing its sheen a week aft its debut, pinch shares connected Monday tumbling beneath its opening trading price, shaving much than $4 cardinal of marketplace worth from its peak.

The plunge successful Trump Media & Technology Group's shares, which debuted connected March 25 nether nan ticker "DJT" aft nan erstwhile president's initials, comes arsenic it disclosed mounting losses successful a regulatory filing. It besides noted that its accountant had issued a informing that its losses "raise important uncertainty astir its expertise to proceed arsenic a going concern."

Shares of Trump Media & Technology Group, whose superior plus is nan Truth Social platform, tumbled $14.50, aliases 23%, to $47.46 successful Monday day trading. That's beneath its opening value past Monday of $49.90 per share, and represents a 40% plunge from its precocious of $79.38 connected March 26. 

To beryllium sure, Trump Media continues to support a heady marketplace capitalization for a business that's successful nan reddish and booked conscionable $4.1 cardinal successful gross past year. Even aft Monday's banal plunge, nan business is worthy $6.7 billion, making it much valuable than companies for illustration Bausch & Lomb, Alcoa Corp. aliases Harley-Davidson — each of which person yearly gross successful nan billions. 

Trump Media's soaring valuation has prompted comparisons pinch alleged "meme" stocks for illustration GameStop, which typically pull individual investors based connected societal media buzz, alternatively than nan tried-and-true yardsticks relied connected by organization investors, specified arsenic profitability and gross growth. Yet Truth Social has positioned itself arsenic an replacement to much established tech giants specified arsenic Meta's Facebook, which besides endured losses successful its early years. 

"GameStop was nan meme banal of a lifetime, but Trump Media has put it to shame," Michael Pachter, an expert astatine Wedbush Securities, told nan Associated Press past week. 

Trump Media & Technology Group connected Monday disclosed much specifications astir its finances. The institution booked $4.1 cardinal successful gross past year, compared pinch $1.5 cardinal successful nan year-earlier period. It besides posted a nonaccomplishment of $58 cardinal successful 2023, compared pinch a profit of $50 cardinal successful nan anterior year. 

Additionally, it noted that its accountant flagged that nan company's losses raise doubts astir its expertise to proceed operating. Such a warning, however, reflects nan company's existent situation; nan institution could turn its personification base, gross and reverse its losses, putting it connected a much unchangeable path. 

    In:
  • Donald Trump
  • Truth Social

Aimee Picchi

Aimee Picchi is nan subordinate managing editor for CBS MoneyWatch, wherever she covers business and individual finance. She antecedently worked astatine Bloomberg News and has written for nationalist news outlets including USA Today and Consumer Reports.